Ultratech Cement India's Largest Cement Company

Summary

Ultratech Cement, India's largest manufacturer of gray cement, ready mix concrete, and white cement, reported a net profit of INR 1,63 cr for Q4 2022. With a market cap of INR 28,300 cr, the company contributes 1.2% to India's GDP and employs over 0.5 million people. It has a global presence, exporting to regions around the Indian Ocean, Africa, Europe, and the Middle East. The company's growth is driven by organic and inorganic expansion, with a focus on sustainability and innovation, aiming to reach a capacity of 121.3 mtpa by 2023.

Takeaways

• 🏭 UltraTech Cement is the largest manufacturer of gray cement, Ready Mix Concrete, and white cement in India, with a market capitalization of approximately INR 28,300-34,000 crore.
• 📈 The company reported consolidated sales of INR 15,521 crore and a net profit of INR 1,63 crore for the quarter ended December 2022, showcasing its financial performance.
• 🌏 India is the world's second-largest cement producer, contributing over 8% to the global installed capacity, with a production capacity of 54 million tons per year.
• 🏗 The cement industry in India began in 1904, and by 1947, there were 18 cement factories with a total installed capacity of 2.15 lakh tons.
• 📊 The Indian cement market size reached 364 million tons in 2022, with projections to reach 483 million tons by 2028, exhibiting a CAGR of 4.94% during 2023 to 2028.
• 💼 The cement sector in India accounts for about 1.2% of the country's GDP and employs more than 0.5 million people.
• 🔑 Strengths of the Indian cement industry include its large production capacity, relatively low energy costs, attractive profit margins, and government support.
• 🚧 Opportunities for growth include the Indian government's focus on infrastructure development, such as converting 100 cities into smart cities, and increasing per capita income boosting domestic infrastructure spending.
• 📉 Threats to the industry include oil price volatility, which impacts production costs, and the potential for oversupply due to increased capacity from both multinational and local companies.
• 📈 UltraTech Cement has grown through organic and inorganic routes, adding around 30 Mt of capacity in the last three years and successfully integrating acquired assets.
• 🌿 The company has a strong focus on sustainability, with a green power mix of 19.8%, supported by 208 MW of W RS capacity and 325 MW of renewable capacity.

Q & A

What is the market capitalization of UltraTech Cement as mentioned in the script?

The market capitalization of UltraTech Cement is approximately 28,300 to 34 crore Indian Rupees.

What was the reported net profit for UltraTech Cement for the quarter ended December 2022?

The reported net profit for UltraTech Cement for the quarter ended December 2022 was 1,63 crore Indian Rupees.

What is the historical significance of 1904 in the Indian cement industry?

The year 1904 is significant in the Indian cement industry as it marks the beginning of the industry with the start of the first cement factory in Chennai.

How much of the global installed capacity does India's cement production account for?

India's cement production accounts for over 8% of the global installed capacity.

What was the total cement market size in India in 2022?

The total cement market size in India in 2022 reached 364 million tons.

What is the expected Compound Annual Growth Rate (CAGR) for the Indian cement market from 2023 to 2028?

The expected CAGR for the Indian cement market from 2023 to 2028 is 4.94%.

What is the significance of the Indian cement industry in terms of the country's GDP and employment?

The Indian cement industry accounts for about 1.2% of the country's GDP and employs more than 0.5 million people.

What is the historical background of UltraTech Cement Limited?

UltraTech Cement Limited was incorporated on August 24th, 2000, as a public limited company named L&T Cement Limited, and it has undergone several name changes and acquisitions to become the largest manufacturer of cement in India.

What is the installed capacity of UltraTech Cement in terms of cement production?

UltraTech Cement has an installed capacity of 116.75 million tons per annum, making it the world's third-largest cement manufacturer.

What are the key cost indicators for gray cement production mentioned in the script?

The key cost indicators for gray cement production are logistic cost (28%), energy cost (38%), and raw material cost (14%).

What is the ESG update mentioned in the script for UltraTech Cement for the third quarter of the financial year 2022-23?

UltraTech Cement has received the ninth Indian Green Building Council (IGBC) Green Champion award for encouraging IGBC accredited professionals for training employees in Green Building.

What is the future expansion plan of UltraTech Cement as per the script?

The expansion plan includes setting up 19.9 million tons per annum (mtpa) of cement grinding capacity, with 10 mtpa already commissioned as of December 2022, and the remaining expected to be commissioned by fiscal 2023. Additionally, a phase 2 expansion plan for capacity addition to 22.6 mtpa across all regions except West is to be implemented by fiscal 2025.